Reckoning

The later 1980s were a period of erratic growth—rapid but unstable. Tigers and sea turtles spurred development throughout the decade: East Asia’s “tiger” economies—Taiwan, Hong Kong, Singapore, and South Korea—paved China’s way in state-led, export-intensive growth. China's “Sea turtles” were the many overseas Chinese who brought capital and knowledge acquired abroad back to their mother country. However, unresolved contradictions lurked in the new political economy of Deng’s China. Frustrations over stalled political reform—enflamed by widespread urban economic grievances over inflation and corruption—erupted in street demonstrations that paralyzed the PRC in the spring of 1989. The Tiananmen crisis would have lasting political repercussions on the cause of democracy—but also unintended economic aftereffects.

Hong Kong Provided China with Capital

Japan Provided Support for Reform

Autocracy and Economic Freedom Brought Growth

Expectations Are the Most Important Growth Factors

Akio Takahara

Professor of Public Policy

Akio Takahara teaches contemporary Chinese politics at the University of Tokyo's Graduate School of Public Policy. His first visit to China was in 1983 as a post-graduate student at the University of Sussex's Institute of Development Studies. In the late 1980's he lived and worked in China as a researcher at the Consultate-General of Japan in Hong Kong. Over the years, he has also held visiting positions at the Embassy of Japan in the People's Republic of China and at Harvard University.

First, Japan was seen as a model of modernization. Deng Xiaoping visited Japan first in 1978 and many, many public leaders followed. And they were greatly interested in the way that Japanese businesses were run, the Japanese industrial policies. For sometime after that, Japan became the model of China. So that was one way. And the second way is, from the late 1970s, the Japanese government decided to provide ODA to China, and China accepted it. As far as the Japanese government was concerned, they did not want China to go back to the Cultural Revolution days and they thought that by supporting the Reform and Opening policies, by supporting China's economic growth, they were actually supporting the Chinese leaders who were trying to push China forward into further reforms and opening. Thirdly, the Japanese businesses also played a large role, because many of the Japanese business leaders at that time had personal experiences with China before and during the war. And a lot of the Japanese leaders felt remorse about Japanese deeds during and before the war and they wanted to compensate for that. And we cannot deny that that that has also played a big role in Japan's cooperation with China.